Transitioning to sustainable energy sources is essential to ensure environmental sustainability and energy security. Integrating energy transition with local economic activities in rural areas remains challenging, particularly in developing innovative community-based financing mechanisms. This study explores how Village-Owned Enterprises (BUMDes), managing water tourism in Klaten district, Central Java, have initiated community-based financing models to support the utilization of water resources as an alternative energy source. The research involved 30 BUMDes affiliated with the Klaten Water Tourism Association. Using a qualitative case study approach, a SWOT analysis was applied to assess the strengths, weaknesses, opportunities, and threats of developing these financing models. Data were collected through in-depth interviews with BUMDes administrators, focus group discussions (FGDs), and analysis of financial and operational documents. The study provides an initial assessment of risk mitigation and implementation feasibility within the current institutional and regulatory frameworks. The results offer a structured framework for policymakers, BUMDes managers, and development institutions to evaluate the potential of community financing and water-based energy synergies in the rural tourism sector. Ultimately, empowering BUMDes to advance innovative community financing is expected to strengthen local community resilience and promote integrated rural development strategies in Indonesia.
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